Yeast Saccharomyces cerevisiae KEX2 gene previously isolated was characterized as the gene encoding an endopeptidase required for proteolytic processing of precursors of alpha-factor and killer toxin. In this study, the cloned KEX2 gene was introduced into the kex2 mutant cells and the KEX2 gene product expressed in these cells was partially purified from their membrane fraction. The enzyme preparation exhibits a calcium-dependent endopeptidase activity with a substrate specificity toward the carboxyl side of Lys-Arg, Arg-Arg and Pro-Arg sequences. The enzyme activity was inhibited by serine-protease inhibitors, such as DFP and PMSF, indicating that the KEX2 endopeptidase belongs to a serine-protease family. The optimal pH was determined to be around 5.5. Thus, the KEX2 endopeptidase was found to be a unique calcium-dependent serine-protease distinct from calpain and trypsin.